| The external diseconomy of enterprises’ production activities makes enterprisesblindly pursue economic benefits and neglect of environmental risk management, whichcause environmental pollution accidents. Using environmental pollution liability insurance(EPLI) to make compensation for environmental accidents has become an important meansfor government to conduct environmental management and protection. The initiatives ofenterprises’ buying EPLI have a decisive role in the development of EPLI. The initiativesof enterprises can be reflected by enterprises’ decision making behaviors in EPLI market.According to the utility theory, enterprises’ code of conduct decision making behaviors isto obtain the maximum expected utility value under risk and uncertainty conditions.In this paper, system complexity was applied to analyze the complexity of EPLImarket. Four factors including governmental penalty on environmental polluters, insurancepremium, environmental risk assessment level of insurance companies and radiation effectfrom surrounding enterprises were selected and an agent-based modeling and simulation(ABMS) method was adopted to simulate the effects of four factors on enterprises’decision making behaviors in EPLI market. Several conclusions were obtained.(1) Governmental penalty on environmental polluters is one of the factors that hadeffect on enterprise’s decision making behaviors. Enterprises that chose to buy EPLIdecreased in governmental penalty while enterprises that chose to strengthenenvironmental risk management measures increased in governmental penalty. Nearly90%of enterprises chose to strengthen environmental risk management measures when theamount of governmental penalty reached30million Yuan, which was about three times ofthe enterprises when the amount of governmental penalty was3million Yuan.(2) Insurance premium is one of the factors that had effect on enterprise’s decisionmaking behaviors. Increase the premium rate from2.5%to3%, the attending insurancerate of EPLI market decreased by20%, which was about10%. Increase the premium ratefrom2.5%to3.5%, the attending insurance rate of EPLI market decreased to only2.3%.Reduce the premium rate from2.5%to2%, the attending insurance rate of EPLI marketdoubled, which was about60%. Reduce the premium rate from2.5%to1.5%, theattending insurance rate of EPLI market increased to about80%. Reduce the premium ratefrom2.5%to1%, the attending insurance rate of EPLI market was nearly90%. Reduce thepremium rate from2.5%to0.5%, the attending insurance rate of EPLI market was close to97%, which was over three times that of the initial attending insurance rate. (3) Increasing environmental risk assessment level of insurance companies couldreduce the occurrence probability of environmental pollution accidents and the cost of riskmanagement of enterprises. When the occurrence probability of environmental pollutionaccidents gradually dropped from0.0035times per year to0.00035times per year, theattending insurance rate of EPLI market was an upward linear trend curve. When the costof risk management of enterprises gradually dropped from X (ranging from15thousandYuan to100thousand Yuan) to0.1X, the attending insurance rate of EPLI market was anupward logarithmic trend curve.(4) Radiation effect also affected enterprises’ decision making behaviors. Under theradiation effect among the enterprises, the attending insurance rate of EPLI marketincreased yearly. The attending insurance rate reached52%for the first year, which wasalmost two times of the initial state. The attending insurance rate continued to increase to82.3%for the second year, and the EPLI market reached saturation in the seventh year witha100%attending rate.(5) Executing a difference to premium rate based on the risk level of the enterprisesand increasing the level of environmental risk assessment services provided for theenterprises would increase enterprises’ enthusiasm in buying EPLI, stimulate EPLI demandand reduce the overall cost of environmental risk control for the whole region. |
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